Flood insurance program cuts may pay for Trump’s Mexican border wall

California insurance industry - flood program

Funding reductions to the Federal Emergency Management Agency (FEMA) may divert cash to cover the wall.

Reports published by Politico and the Washington Post based on internal budget documents they recently obtained could mean money from the flood insurance program will be diverted to cover President Trump’s border wall between the United States and Mexico.

This could mean that, when all is said and done, coastal states may end up paying for a chunk of the wall’s cost.

The reports found that the Federal Emergency Management Agency (FEMA), which is responsible for the National Flood Insurance Program, will be slashed by 11 percent by the Trump administration. They will also be cutting the Transportation Security Administration by 11 percent and the Coast Guard by 14 percent.

New Jersey residents may risk the greatest impact from the FEMA funding cuts as there are more than 200,000 families who purchase flood insurance in that state.

The same documents show that a flood insurance program premiums surcharge will raise money for the border wall.

flood insurance programThat said, the news outlets did not report on the size of the surcharge that will be added to the flood insurance premiums paid by residents of New Jersey and other coastal states. It must also be underscored that, at the moment, the documents obtained by the Washington Post and Politico remain a draft. As of yet, the final details for the ways in which funding will be found to pay for the wall have not been hammered out. Still, it is interesting to note that this strategy is being considered at all.

Some of the latest estimates predict that the boarder wall will cost approximately $20 billion to construct. The Trump administration has been working to decide how the project will receive its funding.

The impact this will have on the affordability of the flood insurance program and the number of people who purchase coverage will be interesting to see, should the Trump administration move forward with this strategy. It is certain that the country is watching to see how else the administration intends to drum up the money needed to pay for the wall.

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